This article was published by CMC Canada in the Summer 2019 issue of Consult.
In my many years as a business advisor and venture capitalist, I have seen companies make a lot of mistakes. There have certainly been successes, but mistakes, unfortunately, are a lot more common. Some of the ones that are the most damaging are those that are analogous to “giving up on the 1-yard line”, where after a prolonged period of time of working, pushing forward, and focusing on their game, a company’s leadership throws up its collective hands and says, “I’m done”. Why is this so harmful?
First, this situation tends to occur when facing challenging tasks that are integral to the success of a company; examples include areas such as properly conducted business planning, implementation of fundamental systems and processes, and successfully attracting financial and strategic partners. Appropriately addressing these areas tends to take far more work than business leaders anticipate; they also represent initiatives that might be entirely new. As a result, the keen enthusiasm that is apparent when a project begins tends to fade to an attitude of “we don’t need to work this hard”.
Second, companies sometimes have difficulty focusing on priorities, as key areas tend to be far less glamorous that the “fun” aspects of being in business, such as designing a new logo, touring office space options, or chatting up prospective partners that the company has little potential of actually attracting. Days get filled with these activities, that are more about busy-ness and less about results, decreasing the amount of available time to focus on the real work that needs to get done. This is a hard lesson that business leaders tend to discover far too late, and can be as damaging as losing key customers or running out of money. Full stop.
A better approach is recognizing that advisors who have “been there” and “done that” are in a unique position to provide the important leverage that companies need, to ensure that they are focusing on the right things, conducting their work at a quality level, and not running out of steam. How can this be achieved?
- Priorities are not always obvious. Amazing, but true. Business leaders can get so caught up in the challenges of running the company on a day-to-day basis, dealing with staff members, and responding to customer needs that they are unsure (or unaware) about the steps that should be taken to make meaningful progress on a corporate level and might lack the experience of what is required in order to do so. Advisors can play a key role by identifying and prioritizing task items and keeping the implementation process on track. All of these areas are common pitfalls and represent the difference between starting something and actually getting it done (activity does not equate to meaningful progress).
- Experienced advisors are the “acid test”. Advisors with a strong experience and qualification base understand where important initiatives need to “get to”, such as what financial partners need to know in order to make a decision. Companies tend to take the view that “what we provide to them will be good enough”, failing to understand the woeful inadequacy of this approach. Using raising capital or financing as an example, experienced financial partners have typically reviewed more opportunities than they can count and operate in an environment of limited money and an investment mandate that guides selection. They very quickly slot opportunities into a category, and chances are, it won’t be the “yes” file. Experienced advisors have a skillset that is extremely valuable; one that can help a company put its best foot forward and anticipate what is required in order to get to a successful outcome. Be sure to probe an advisor’s qualifications to ensure that they are the right fit for the particular initiative at hand.
- Utilize skill to get there, faster and better. Teams who spend the whole game running around on the field, for the sake of running around, don’t win very many games. Coaches of successful teams know how and when to utilize resources in a manner where they can make the best contribution, including recognizing that there are times when specialized help is needed. This is where an experienced advisor can play an important role, providing the necessary expertise to quarterback complicated plays and get to the endzone more quickly. Business leaders sometimes do not appreciate the value of resources with the right experience; this fact tends to get reinforced in times of poor advice, from those who are not qualified to help, or when receiving no assistance at all. A company might not recognize the weaknesses that result, but the external party that they are trying to impress likely does.
These lessons might seem relatively straightforward, but reality reflects something quite different, as fumbles and mishaps in all of these areas, and numerous others, are quite common. What can make a big difference is perspective; stepping back to see how far an initiative has come, the relatively short journey that remains, its level of priority, and what success requires. If business leaders did this more often, there would be far fewer companies walking off the field with only one yard left to go.